Seattle Times (09/22/08); Lohr, Steve
The finance arm of General Electric--which includes property lending, home mortgages and credit cards and accounts for half of its profits--is putting pressure on the industrial giant. GE Capital entered the subprime mortgage lending market by acquiring WMC Mortgage in 2004 but, reacting to red flags, sold the business in 2007 and took a loss of about $1 billion. Robert Spremulli, an analyst at the investment company TIAA-CREF, says "that was a big mistake... but it wasn't a disaster for GE." The finance unit is still exposed, however, to residential mortgages and commercial real estate loans--although most are outside of the United States.
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